UPDATE 1-Australia's new gold rush lures prospectors Down Under

4 Min Read

* Canada’s Kirkland Lake Gold lists on ASX

* Sees growth in far west Australia

* Gold rush underway (Adds Kirkland ceo, analyst comments)

By James Regan

SYDNEY, Nov 30 (Reuters) - Canada-based Kirkland Lake Gold listed its shares on the Australia bourse on Thursday after investing millions of dollars and joining dozens of other prospectors in a modern-day gold rush.

Kirkland Lake expects to produce a quarter-million ounces of gold in 2017 from a mine it bought a year ago in eastern Australia and is also dipping a toe into a tantalizing new gold region on the other side of the continent.

More than 25 publicly-listed companies and legions of small prospectors are exploring for gold on the western fringe of Australia in an area known as the Pilbara, better regarded for iron ore.

The target is gold occurring in clusters of pebbles and which investors such as Kirkland are betting will compare in size with South Africa’s massive Witwatersrand Basin, where more than a third of the world’s gold has been mined.

Kirkland Lake already holds 18.2 percent of Novo via a A$56 million investment, and earlier this month subscribed to A$5 million of De Grey Mining shares, pending shareholder approval.

Out in the Pilbara, prospecting is proving particularly popular among so-called “grey nomads,” retirees with a bent for traveling around the country in caravans and motor homes.

It took retired carpenter Pete Caudwell just three days to find two dozen gold nuggets - almost enough to pay for his A$6,000 metal detector.

With overhead costs now covered, Caudwell, who still speaks with a thick British accent half a century after migrating to Australia from Nottinghamshire, is looking to turn a profit.

“I’ll be back again after the summer passes to try my luck again,” Caudwell said. “It’s too hot to prospect on my own there now.”

But for mining companies it could take years to determine if enough gold exists to start mining on a commercial scale.

“It is very early days and despite the publicity, there is a great difference between an exploration play and a successful mining venture,” said Sandra Close, a director of gold consultancy Surbiton Associates. “Exploration is a risky and expensive business.”

$1 = 1.3177 Australian dollars) (Reporting by James Regan; editing by Richard Pullin)